Afghan Leader Admits His Office Gets Cash from Iran

DEXTER FILKINS and ALISSA J. RUBIN

Tuesday

Oct 26, 2010 at 5:11 AM

President Hamid Karzai said that he uses an off-the-books fund to pay expenses incurred in the course of doing his job.

KABUL, Afghanistan — President Hamid Karzai acknowledged on Monday that he regularly receives bags of cash from the Iranian government in payments amounting to millions of dollars, as evidence mounted of a worsening rift between his government and its American and NATO supporters.

During an often hostile news conference, Mr. Karzai also accused the United States of financing the “killing” of Afghans by paying private security contractors to guard construction projects and convoys in Afghanistan. He has declined to postpone a December deadline he set for ending the use of private security forces despite urgent pleas from Western organizations, including development organizations, that need protection here.

His statements were the latest indication that American relations with Mr. Karzai were badly frayed, despite diplomatic efforts to mend ties and improve governance in Afghanistan. The tensions threaten to undermine President Obama’s goal of handing responsibility for the war against the Taliban to Mr. Karzai and the Afghan military, allowing the United States to begin withdrawing troops next year.

“They do give us bags of money — yes, yes, it is done,” Mr. Karzai said, responding to questions about a report in The New York Times on Sunday that Iran sends regular cash payments to his chief of staff, Umar Daudzai. “We are grateful to the Iranians for this.”

“Patriotism has a price,” he said.

Afghan and Western officials said the Iranian payments were intended to drive a wedge between Mr. Karzai and the United States and NATO.

On Sunday, Mr. Karzai held a volatile meeting with the NATO commander, Gen. David H. Petraeus, as well as other senior Afghan and Western officials to discuss the private security firms. Mr. Karzai stormed out of the session, saying that he did not need the West’s help, according to people knowledgeable about the confrontation.

President Karzai has so far refused to modify the ban, although he has said that he would consider requests to delay it on a case-by-case basis. In many respects, his sharp words reflect a widespread feeling among Afghans, especially in insecure areas, that foreign security firms are running roughshod over them and intruding in culturally unacceptable ways on their daily lives.

At the news conference, Mr. Karzai lashed out at the United States, implying that American officials had leaked information to The New York Times about Iranian payments because of disagreements over the private security companies.

The private security companies, many of which are paid for by the United States, are spreading chaos and unjustly killing Afghan civilians, Mr. Karzai said.

“The money dealing with the private security companies starts in the hallways of the U.S. government,” he said. “Then they send the money for killing here.”

Under a decree he issued in August, all private security firms must stop operations by Dec. 17. The United States and other Western governments here say they accept the ban, and they are trying to switch to the use of the Afghan police and soldiers to protect their military convoys. But many Western officials say the Afghan police and military are undertrained, overstretched and ill equipped to provide proper protection for foreign interests.

They have asked for additional time to make the change, especially for civilian development organizations. Those organizations say they will not be able to continue work without security for employees, potentially endangering several billion dollars worth of programs and projects.

The Afghan president said security companies were responsible for a litany of bloody crimes against the country’s people. “When this money comes to Afghanistan, it causes insecurity in Afghan homes and causes the killing of Afghan children and causes explosions and terrorism in Afghanistan,” Mr. Karzai said.

He leveled several accusations against Western interests in Afghanistan and the news media, even going so far as to say that the security companies were interchangeable with the Taliban.

“In fact we don’t know how many of the explosions are the fault of the Taliban and how much by them,” said Mr. Karzai, referring to the security companies.

Mr. Karzai’s distrust of the Western alliance has increased over the past several months even as more soldiers have flowed into the country and more civilian development workers have begun to carry out projects, leaving diplomats and military officials increasingly frustrated and confused.

Western officials said they were disheartened but not surprised by the virulence of his tone, and they said they would continue to try to find a solution that allowed development projects to continue.

“It’s disappointing, but it’s vintage Karzai,” said a Western official in Kabul, adding that the accusations were hurtful when Western soldiers and Marines were dying in the field. “But when you are losing the numbers we are as an alliance and then when you got your reliable partner in Kabul saying such things, it sticks in the craw a bit.”

The Iranian payments are another significant source of tension. Mr. Karzai discounted their importance, claiming that the cash transfers were well known, and that he had even disclosed them to former President George W. Bush during a meeting at Camp David. He says that he uses the money to pay expenses incurred in the course of doing his job, including for “special expenses and helping people.”

Mr. Karzai says others give him cash payments as well. “The United States is doing the same thing. They are providing cash to some of our offices,” he said.

He says Mr. Daudzai is the courier for the Iranian cash, which amounts to about $1 million “once or twice a year.” The Times previously quoted Afghan and Western officials as saying that Mr. Daudzai has received regular payments from Iran that totaled about $6 million.

Asked what he does in return for the Iranian money, Mr. Karzai said: “They have asked for good relations in return and for lots of other things in return.”

Mr. Karzai’s admission followed firm denials by members of his staff that such payments existed. Iran’s ambassador to Afghanistan, Feda Hussein Maliki, also denied that he or his government passed any money to Mr. Karzai’s office.

The Iranian payments are not large, at least compared with the hundreds of billions of dollars the United States has spent to oust the Taliban from power, support Mr. Karzai’s government and fight a tenacious insurgency intent on toppling Mr. Karzai.

But Western officials say they are disturbed by Mr. Karzai’s close relationship with Iran’s leaders, in part because of mounting evidence that the country’s intelligence services are aggressively trying to undermine the American-led mission here. NATO officials say that Iran is paying for, arming and training Taliban fighters, as well as financing political candidates in the parliamentary elections.

In his news conference, Mr. Karzai also attacked The Times for publishing the report about Iranian payments, even as he confirmed receiving such payments. He urged the Afghan news media to “defame The New York Times as they defame us.”

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